Friday, May 11, 2007

Newsletter dated 11th May,2007

U.S. stocks slumped in their steepest fall in two months on Thursday, as disappointing retail sales and a widening trade deficit aroused worries about the economy.Investors opted to lock in profits after a string of record highs for blue chips in recent weeks, and a day after the Federal Reserve said it was still concerned about inflation.

U.S. retailers reported the weakest April sales results on record, after cold, stormy weather coupled with an earlier Easter holiday than a year ago, with some chain stores also cutting their earnings forecasts.Yesterday's downturn is a combination of retail sales numbers being weak and the fact the Federal Reserve did not provide any further hints that it's getting closer to lowering interest rates yesterday.

The market's performance doesn't mean it is falling apart. But in the very near term we may see some profit taking and hesitation as investors await more economic data.The Dow Jones industrial average <.DJI> was down 147.74 points, or 1.11 percent, at 13,215.13. The Standard & Poor's 500 Index <.SPX> was down 21.11 points, or 1.4 percent, at 1,491.47. The Nasdaq Composite Index <.IXIC> was down 42.60 points, or 1.65 percent, at 2,533.74. Of the 30 Dow stocks, only four closed higher.

The Nikkei average fell 1.37 percent on Friday, weighed down by Casio Computer's. Investors took profits in recent gainers such as exporters due to growing concerns about the U.S. economic outlook. The Shanghai Composite Index <.SSEC> was down 0.83 percent. On top of the fact that investors were already cautious before another peak of earnings announcements next week, it is unavoidable for Japanese stocks to fall on U.S. stocks.

British interest rates hit a 6-year high of 5.5 percent on Thursday and could rise further still as the Bank of England tries to rein in inflation, now at its highest level in more than a decade.

The blue-chip Hang Seng Index <.HSI> was down 1.5 percent, following declines in U.S. and mainland-listed stocks. All other Asian markets are trading lower.

Sensex might open 200-250 points lower following the global market cues. We might see buying in Technology stocks at lower levels as the dollar has become stronger by 38 paisa against rupee at 41.28. Oil PSUs may also witness buying at lower levels following lower crude price at 61$.

You may buy the following stocks at opening bell:-

1. INFOSYS

2. TCS

3. HCL TECH

4. BOMBAY RAYON FASHIONS

5. MINDTREE CONSULTING

6. PAGE INDUSTRIES (DARK HORSE OF TODAY)

7. BAJAJ AUTO

No specific BUY price is mentioned in my above calls (it will be mentioned to our paid clients only). Do your own homework before trading in the above stocks.

Note:-
1. Place Stop loss 3-4% below your cost price.
2. Do your own homework before trading.
3. Book profits if you get 2-4% return.

ANURAG DUJARI
Mobile - 09831909904, 09433988791, 09330911514, 09883059291
Messenger ID - anurag130
E-Mail - anurag130@yahoo.com

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